Bitwise: The poor performance of BTC in September is mainly due to the dismal performance of risk assets, pressure from SEC enforcement season, and the push from reflexivity theory

According to a detailed analysis by NYDIG, Bitcoin has fallen in 9 out of the recorded 13 Septembers. As of last Sunday, so far this month, Bitcoin has dropped by 7%. Matt Hougan, Chief Investment Officer at Bitwise, stated that there are three main theories driving the "September Effect":

1. September is a bad month for all risk assets - Bitcoin is not the only asset affected by the back-to-school season. Since 1929, September is the only month where stock market declines outnumber rises. This effect is particularly evident in the Nasdaq 100 index which has a large proportion of tech stocks. As of Friday, September 6th, the Nasdaq 100 index had already fallen nearly 6% this month.

2. SEC enforcement season puts pressure on cryptocurrencies - The U.S SEC's office hours run from October to September each year. Historically speaking, this means you often see many enforcement actions in September as lawyers try to meet their annual quotas. Unsurprisingly, US SEC enforcement season is heating up: This month we have already seen meaningful settlements between SEC and crypto fund provider Galois Capital and Wells notices against NFT platform OpenSea. Many predict that lawsuits and settlements against crypto entities will intensify by end of month; I wouldn't be surprised; since early summer I've been hearing rumors about larger scale law enforcement actions and we've long warned about dangers during SEC enforcement season.

3.Reflexivity - The best explanation heard about 'the September effect' might be that it's simply self-reinforcing: people now expect September to be bad and indeed it turns out so.While this may not sound earth-shattering,it isn't: expectations drive markets.In contrast,Bitcoin investors have always liked October—after all,the month known as "Uptober," thanks to an average rise of bitcoin price by30% during then.This could stimulate investor animal spirits.Historically,October and November have been one of the best months for cryptocurrency investors.